With Lithium being much in focus due to the increasing demand for the electrification of many areas on the planet, expectations and dreams around the delicate metal grow by the day. Many electronics devices, most devices with rechargeable batteries, modern electric vehicles in particular, but also in storage and balancing battery systems for the electric grid – they require Lithium. All this is stirring the dreams of those governments, regions and countries having Lithium as one of their raw materials at hand. Like Afghanistan.
Besides some precious stones – which illegally are mined by many groups since decades – Afghanistan has several other raw materials, and a huge supply of Lithium among them. The war-worn country officially is led by the Taliban but with many regions under control by other groups and even terrorists. Situated in Nangarhar province, one of these opposing groups, the ISIS-K, seeks control over Ghazni province, with the goal to occupy the south of the capital Kabul and, therefore, having access to some of the raw materials as well as the smuggling routes towards Pakistan. One focus lies on Lithium in the Ghazni province. In parallel, the government seeks to find cooperating partners for mining Lithium as well – in the Ghazni province, for instance. Conflicts, therefore, can be expected. However, there are other areas where the Afghan people could mine Lithium, in the provinces of Helmand, Daykundi and Uruzgan, for instance.
Foreign countries and companies are interested in Lithium
This puts light onto a number of opportunities but even more on the obstacles. First and foremost, all known facts of the areas where Lithium can be found, and the calculated amount are based on Russian explorations from the mid 80ies and even earlier British information. Thus, the database is at least 40 years old. These figures neither have been thoroughly updated, nor verified, and not properly aggregated, too. Furthermore, there is a good chance to find more regions with Lithium as well as other sought-after minerals and metals.
Besides exploration, the infrastructure, dependability, safety, continuous supply, social and environmental sound mining are further obstacles which need to be overcome. And this are a huge tasks. As of today, there are five Chinese companies – like Ganfeng Lithium corporation – looking into the Lithium business in Afghanistan. Many of the country’s Lithium deposits are in remote locations with limited infrastructure. Decades of war and economic hardship have deteriorated the situation. China has been willing to undertake risky projects to support strategic investments in other countries like Nigeria and learned it is not worth the hassle. As a result, the Chinese are interested, but also reluctant to go for the Lithium in Afghanistan.
What is needed to attract foreign countries and companies to go into the Lithium mining business in Afghanistan? To obtain the raw materials lots of rocks/minerals need to be transported to the processing plants, ideally located nearby. Thus, safe well-built roads for heavy-duty trucks or heavy-duty train tracks coming from the mines to the processing plants and from there to the borders for export are needed. Access to these remote areas, thus the infrastructure, plays a significant role.
To run these activities, many people are needed to do all the jobs and these people need accommodation as well as healthy food, medical help, transport, communications, entertainment, education, and more. Mining and particularly mining of Lithium needs lots of water. Water supply as well as environmental sound mining including saving water have become major issues. Many markets and the car & truck businesses in particular require a number of (independently controlled) actions to ensure social and environmental sound mining as well as the use of water: the car industry learned from the Cobalt disaster to closely monitor the situation at each mining facility.
Time and dependability
It takes about seven years to build, install and put a large and well monitored mining facility for Lithium into operation. In a situation of uncertain exploration data, two years for exploring the area, sources and mines must be added. These huge investments in geology, technology, labor, and time makes sense only if such a facility can safely run for as long as possible, preferably over decades. Thus, dependability is key. To make all parties profiting from such a mine, continuous supply, transport and sale of the metals and materials must be ensured. All this can only be achieved in a safe and stable environment. Frankly, Afghanistan neither will be able to provide the required infrastructure, nor the dependability, safety and continuous supply to achieve an economically successful operation. Not even mentioned the social and environmental sound mining which needs to be ensured, controlled, and confirmed.
Mining on a small scale as done today in Afghanistan is a way to sell raw materials like Lithium into secondary channels. These channels do not pay market prices and they do not ask questions. This might be an opportunity for ISIS-K and others, but it certainly isn’t an option for the Afghan government in the long term since it is not economically sound. In order to properly and continuously make money with Lithium and other raw materials, the preconditions have to be established, adapted and improved, first
Lithium is not at short supply
With crude oil, we were informed to see peak [supply of] oil very soon. Such stories came up first about 100 years ago, but the fossil fuel companies found more oil in countless new areas worldwide. Today, we talk about peak [oil] demand and this is more likely to happen before peak oil. Same applies to Lithium. Several analysts said we already are facing a shortage of Lithium. This, as well, is not true. Lithium is at high supply and rising demand. Several new Lithium sources – many easily accessible – have been found during the past few years. There are large new ones in Iowa, a huge source underneath the river Rhine in Europe, many more have been found in several countries, including China, but most of them in South America. Furthermore, there is lots of Lithium in sea water, too. Why do we suddenly find so many Lithium sources, now? Simply said, if you search for something very specifically you probably will find some – like California’s Salton Sea area which is abundant with Lithium and is enough to build tens of million electric vehicles. Furthermore, this Lithium source is easily accessible.
There is a high and rising demand for Lithium, but no, there is no need to go far into remote areas of instable countries like Afghanistan to obtain the metal. Prices for Lithium came to an all-time high in late 2018 but then gradually dropped and now are relatively stable. New battery designs require less Lithium while the battery sizes become bigger. Furthermore, recycling will become the most important source of Lithium within the next ten years. As a result, Afghanistan is no treasure trove, companies can more easily acquire Lithium (and other critical minerals) from alternative sources. Most countries and companies are well aware of the risks and headaches that come with doing business in and with Afghanistan. As a result, China is not going to rush into Afghanistan, nor does any other country.
In response to the question above Lithium is not the new gold for Afghanistan since the preconditions are so questionable: The Taliban and ISIS-K dreams of a money flow by Lithium will not happen. And this applies to other raw materials, too. For instance, many rare earth elements can be found in Afghanistan. But with their name comes a misunderstanding: rare earth elements are not rare by the means of abundancy, they are “rare” since they “rarely exist in their purified form”. Thus, rare earth elements require extensive processing – which as well requires infrastructure locally.
For Afghanistan it becomes vital to sort the infrastructure issues out which not only means roads and train tracks, but also hospitals, educational facilities, stores, entertainment, and social life – since with the investments in mining and processing by foreign countries and companies’ specialists are coming and will work in Afghanistan: they want a normal life. The government’s plans for such investments are highly important for being able to profit from all the raw materials. Otherwise, it all remains dust.
Which would be very sad since the country and particularly the areas where raw materials can be found are of an exceptional beauty with inhabitants of unparalleled hospitality.